The Power of Free PR: From Influencers to Business Leaders

More are going from being influ­en­cers to busi­ness leaders.

In 2020, I argued that influ­en­cer-star­ted busi­nesses would emerge as real threats to tra­di­tion­al businesses. 

I got push­back; few agreed with my analysis.

Was I wrong? In this post, I want to revis­it my ini­tial ana­lys­is and fur­ther invest­ig­ate how the busi­ness land­scape evolves.

Here we go:

The Advantage: Free Marketing and PR

Back in 2020, my main argu­ment was that influ­en­cer-star­ted busi­nesses would have one main advantage:

The advant­age of influ­en­cer-star­ted busi­nesses: Free mar­ket­ing and excel­lent PR with an exist­ing niche audi­ence are decis­ive advant­ages for any com­pet­it­ive venture.

Read also: Influencer Marketing is A‑Changing

I argued that the mar­ket­ing- and PR advant­age would be so prom­in­ent that influ­en­cer-star­ted busi­nesses would soon begin to chal­lenge tra­di­tion­al busi­nesses, even glob­al power­houses like McDonald’s.

The push­back argu­ment was that influ­en­cers couldn’t chal­lenge tra­di­tion­al busi­nesses due to their lack of cor­por­ate pro­fi­ciency. Scaling a busi­ness is not easy.

The con­sensus seemed clear: “Influencer-star­ted busi­nesses will con­tin­ue to pop up and be inter­est­ing, but… in no way will they be able to chal­lenge tra­di­tion­al megabrands.”

PR Case Study: MrBeast Burgers

Later in 2020, the fam­ous Youtuber MrBeast (Jimmy Donaldson) opened MrBeast Burgers, a vir­tu­al res­taur­ant. A vir­tu­al res­taur­ant means you can order from the MrBeast Burger’s menu via vari­ous apps, and oth­er exist­ing res­taur­ants (“ghost kit­chens”) will ful­fil your order. ¹MrBeast. (2023, January 12). In Wikipedia. https://​en​.wiki​pe​dia​.org/​w​i​k​i​/​M​r​B​e​ast ²MrBeast Burger. (2023, January 13). In Wikipedia. https://​en​.wiki​pe​dia​.org/​w​i​k​i​/​M​r​B​e​a​s​t​_​B​u​r​ger

The suc­cess was massive des­pite (or thanks to) the Covid-19 pan­dem­ic, and the extra rev­en­ue saved many fast-food res­taur­ants. Today, the menu can be ordered from 300+ loc­a­tions in the USA, Canada, the UK, and oth­er places worldwide.

It took Beast Burger three months to sell 1 mil­lion ham­burgers. In late 2022, the brand opened its first phys­ic­al res­taur­ant in East Rutherford, New Jersey. Ten thou­sand people showed up, and they man­aged to serve a record-break­ing 6,212 bur­gers on open­ing day. ³

MrBeast Burgers is still a far cry from pos­ing a real chal­lenge to a glob­al brand like McDonald’s. The ques­tion is: will it ever?

The Slight Edge: The Overall Experience

What could chal­lenge a mega­brand like McDonald’s?

Let’s cla­ri­fy: it’s not decided by one thing, like the taste. McDonald’s is great in many ways, but most bur­ger lov­ers will attest to the simple fact that McDonald’s isn’t renowned for serving the best-tast­ing bur­gers in the world.

McDonald’s has many advant­ages. I don’t know which advant­ages allow them to dom­in­ate their mar­ket. I know that when you com­bine the pos­it­ives and the neg­at­ives into a sin­gu­lar brand exper­i­ence, McDonald’s is a pop­u­lar enough choice to rule the world of fast-food bur­ger restaurants.

But this is also why MrBeast Burgers doesn’t have to make bet­ter bur­gers to chal­lenge McDonald’s. They only have to be the slightly more pop­u­lar choice over­all, par­tic­u­larly whenev­er they open up a phys­ic­al loc­a­tion next to a McDonald’s. ³The bene­fits of suc­cess are rarely evenly dis­trib­uted; it’s the nat­ur­al out­come of the power-law dis­tri­bu­tion.

And since it’s not down to one single thing, like the taste, price, size, avail­ab­il­ity, or qual­ity, I’m arguing that influ­en­cer-star­ted brands will have a reas­on­able shot at con­tend­ing even with glob­al mega­brands — at least when it comes to a cru­cial com­pon­ent: the over­all experience.

And this is where the ana­lys­is of influ­en­cer-star­ted busi­nesses gets interesting.

An Audience Isn’t Something You Buy

Influencer-star­ted busi­nesses have the advant­age of free mar­ket­ing and PR. But they also have the advant­age of hav­ing a nur­tured brand community.

This means that influ­en­cer-star­ted busi­nesses are in a favour­able pos­i­tion when it comes to one par­tic­u­lar expertise:

How to cre­ate exper­i­ences that audi­ences seek.

Influencers might not be well-versed in run­ning or scal­ing busi­nesses — yet. But they are mas­ters in tail­or­ing exper­i­ences and nur­tur­ing audi­ence relationships.

Or put in oth­er words:

MrBeast has a bet­ter shot at improv­ing the McDonald’s exper­i­ence than McDonald’s has at improv­ing the MrBeast experience.

MrBeast can lever­age his enorm­ous fame to hire armies of people from the res­taur­ant busi­ness. But McDonald’s can nev­er hire someone that con­stantly can churn out videos aver­aging 100M views on YouTube.

Will MrBeast Burgers chal­lenge McDonald’s?
Well, that’s not the point.

From Influencers to Business Leaders

Do I think that MrBeast Burgers will be able to chal­lenge McDonald’s? For that to hap­pen, so many more things must go MrBeast’s way that the pro­spect of it ever hap­pen­ing must be deemed highly unlikely.

I’m the first to admit that the odds don’t favour MrBeast Burgers.

But I think influ­en­cers will con­tin­ue to launch more and more busi­nesses — MrBeast Burgers is just one of the thou­sands of ser­i­ous attempts to come. 

And influ­en­cer-star­ted enter­prises will become increas­ingly more prom­in­ent threats to tra­di­tion­al businesses. 

In 2022, Joakim Lundell, argu­ably the most prom­in­ent social media influ­en­cer in Sweden, pro­duced a low-budget hor­ror movie that became the highest-gross­ing Swedish film ever in its genre and went straight to num­ber one — with almost half of the tick­ets for the open­ing week­end sold in advance. ⁴Feed (film). (2022, December 26). In Wikipedia. https://​sv​.wiki​pe​dia​.org/​w​i​k​i​/​F​e​e​d​_​(​f​ilm)

Had Lundell ever pro­duced a movie before? No. Does he know what kind of exper­i­ence Swedish hor­ror fans are look­ing for? He does.

Four Business Advantages of Influencers

I would even go so far as to push my argu­ment to its limit:

Passionate niche audi­ences might find tomorrow’s busi­ness lead­ers bet­ter than cor­por­ate pro­mo­tion systems.

Having seen the naked interi­or of hun­dreds of cor­por­ate pro­mo­tion sys­tems through­out my career as a con­sult­ant, I’m not impressed. These pro­mo­tion sys­tems pro­duce bosses, not lead­ers.

This devel­op­ment could grow expo­nen­tially as more busi­ness cases accu­mu­late and more ven­ture cap­it­al­ists get on board. Traditional busi­nesses might be star­ing into an avalanche.

Here’s how I’d sum­mar­ise my argu­ment today:

The first advant­age of influ­en­cer-star­ted busi­nesses: Free mar­ket­ing and excel­lent PR with an exist­ing niche audi­ence are decis­ive start­ing points for any com­pet­it­ive venture.

The second advant­age of influ­en­cer-star­ted busi­nesses is: Influencers are experts at cre­at­ing sus­tain­able and long-term audi­ence rela­tion­ships using per­fectly tailored experiences.

The third advant­age of influ­en­cer-star­ted busi­nesses is: Influencers can copy tra­di­tion­al busi­nesses, but tra­di­tion­al busi­nesses can­not copy the rela­tion­ship between influ­en­cers and their audiences.

The fourth advant­age of influ­en­cer-star­ted busi­nesses is: Niche audi­ences are bet­ter at appoint­ing lead­ers than tra­di­tion­al cor­por­ate structures.